tv Street Smart Bloomberg December 24, 2013 12:00pm-1:01pm EST
i am wearing jeans. >> i had to wear a suit. let's go to the big picture. the charts you need to see to show you what is happening. the s&p -- this is the third day in a row where we are forming a new all-time high. 3% in just six days. this has been on a tear. 1833. some very strong data this year, durable goods up 3.5%. for capex, upxy 4%. we are showing the retailing index. but me see a 10 year. we do not have a 10 year -- >> the yield is up. about 2.95, the highest we have seen. >> retail, unchanged. there is concern and we will get
into this. the consumer, despite the economic data coming in pretty strong, does not seem to be spending as much in the brick-and-mortar stores. >> that is part of the problem. look at oil, this is another big story. it is only of $.30. it is $99.21, speaking to the fact that durable goods orders and capital goods orders, the proxy for capex, the amount of money companies are spending, you expect the man to be up. >> let's look at what is moving. julie is joining us to highlight some of that. >> i do not think the tweed jacket was a fiasco. >> you were the only one. >> thank you. i am not allowed to wear tweed. >> tesla shares are rising today national highway traffic safety administration reaffirmed its five-star star safety rating for the model s,
the 2014 model year. there was concern because of fires in vehicles that it would not retain that but it did. share is up 6.5%. we are talking to an options trader who pointed out there is still quite high short interest stock, you have to factor that in. you heard adam talk about economic data out today. another data point, home sales for november. coming in higher than estimated and revise higher for october. kb home is among the homebuilders doing well. a stock that is rising to a record is twitter. yesterday and up today nearly 7%. facebook rose to a record yesterday. a lot of optimism around social media advertising, mobile advertising. twitter has been riding that wave. story.s move onto the fewer americans hitting the malls.
20 --tore visits plummeted 21% and retail sales .1%.ped to .1% -- 3 many retailers offer discounts and around-the-clock hours, not of it swayed shoppers. instead, they opted for online shopping. instead of standing in line. it looks like it is going to be a lackluster finish for retailers and their most important season. let's see what our roundtable thanks. analyst howardor davidowitz, julie hyman. howard -- it makes sense. who wants to go and stand in line and deal with holiday crowds if you can shop online. do it that way now. someone is paying the price, the brick-and-mortar. >> it depends what segment. if you go to michael kors or tiffany's, people go to the
stores. if you are in sporting goods, you are doing terrific. it depends what business you are in. some are doing extremely well. if you are in the middle class, susan cole's -- sears and kohl's. >> a lot of places are discounting and that is hurting margins. thelmost everyone, with exception of a few higher and retailers, you are seeing discounts. a lot of people are shopping online, but the online retailers are not immune to discount. or some other online retailers, you're still getting deals. the concerned there is that even their -- >> you are getting too good a deal. a margin issue anyway. maybe they are offering free shipping. whether you talk about bricks and mortar or online. >> how messy is it for companies looking at all these discounts
this year? looking atyou are 50% off for the price of entry. historically, people a full price. that became funny present, then 40%. 50% is the magic number. the leverage you have now is time and price. you can either go earlier -- >> they do not have either. it is a six-day shorter selling season, there goes time. as far as price goes -- a 50% is the new 20%. you have not used the d word. toi think there is a race the bottom on margin. that's why most retailers have lower earnings. the problem is how do you get margins and a play for the consumers are watching every dollar. how are they going -- they can compare prices easier than ever. >> you think of what the consumer has been through the last couple years. you think about 2008. everyone suddenly started
looking for that bargain. it almost feels as though it was a shift that stuck with us. we have been in this environment with slow economic growth. people have been uncertain about their future, uncertain about their jobs. as a result, they have really sought to spend less. and so, that oregon has become -- that bargain has become all the more important. >> leslie get the real numbers. no psychology. 50ium income five years ago, $7,000. it is now $51,000. new jobs this year, 77% part-time compounding wage. -- p overty wage. >> they are spending on some things. they are buying furniture, cars. >> big-ticket items. >> if the budget is already
stretched and these are the things they feel like they have to buy or they really want to buy, then there is less money for clothing. that has been hit pretty hard. and some of these other items. >> simeon, winners versus losers,. to julie's point, abercrombie & fitch, aeropostale are losers. >> people are willing to spend if you give them a reason to spend on certain items. you look at the gap. winners are eight mar-- a m arket share dollar game. urban outfitters, you have the tail,pt in teen re anthropologie is selling at full price. there is an element of boredom. >> quality boredom? is no reason to go and
buy something new because there is no makeshift. shift in what people are wearing. no colored jeans. >> teens feel most pressure. >> do you think the idea that there has been a shift -- not just because of what people are up against. even for those that found jobs and are doing better, do they expect to get a better bargain right now? it, theubt about consumer is more price aware. they have more ability to compare prices. affect 40% of purchases. this is huge. it is only 7% of the business but it affects 40% of decisions. >> because they are researching before -- >> researching before they buy. they are able to do it. >> i had not thought of it.
people go online and compare prices. they say where can i get this cheapest. nothat is a huge factor talked about enough. what influences the purchase? of best buy, the second-best performer of the s&p, he said last year that we will match amazon. now they have to and it is part of their policy. >> if you are in electronics, there is no differentiation of products. why would you pay more for a commodity? >> how do you compete? in this kind of environment -- if you can only compete on price. e? you need scal >> you have to be different and creative, like a michael kors. a lot of people are very curious and finding new niches. if you do the same thing everybody else is doing and the
only different is price and convenience. >> what about michael kors? his lot of people think products are different. price, value, product developer. they are different. his fans are different. his accessories are different. >> sleek. >> a lot of people like it. >> that is true of what we were talking about, gap has managed better. urban is the same situation. abercrombie and american eagle have not done that. it still matters what you are selling. >> you brought of cigna, cigna tells a commodity, the -- you brought up signet, signet sells a commodity. 6% on marketing, everyone knows the jingle. he went to jared, every kiss
begins with kay. you tell people that this is a brand and it goes far. i am willing to spend for that. that is why this company is doing a good job. take away,my differentiate yourself. whether you spend more on marketing or you have these edgy products. >> take a step back and look at the stocks. hascommentary around retail been terrible for months and months. i looked at retail stocks since thanksgiving, they are kind of flat. why aren't people selling these as a group? >> they will. >> it is trading near records for these stocks. >> thank you so much, it is great to have you here. west said kanye recently that louis vuitton purses are too expensive -- two extreme. the rapper that collaborated
with the company on $1000 sneakers. the guy who proposed with a 15 carat engagement ring. it a is saying this, is sign that luxury companies are charging too much? one of the best christmas movies of all time, one of the best wall street movies of all time. it looks a lot like you, adam. on the success of that. more next. ♪
now it is $4900. serious inflation. it is still the same letter. -- same leather. of leather,osts bloomberg tracks letter prices and exotic hides. there is the index. going up. the question is whether prices are going up at the retail level faster. howard davidowitz, why is it -- in the chanel bag example, doubling in price in three years. the luxury people are going to get as much as they can get and they can get it. i do not have to tell you what is going on with wealth exploding. hitink they are going to the wall. if you take an area like accessories, on fire. you can sell it for anything. hermes has those $15,000
handbags. they create the scarcity. this stuff is going out like mad. >> the prices keep going up. >> here is the problem, there will be a problem. if you are selling a cashmere sweater for three times what it is worth, i will not mention the store's name. >> you mean what it costs to make? >> compared to j.crew. you got something at a j.crew quality and j.crew is a private label. you are selling it at three times the price. the thickness of the cashmere is no more than j. crew -- thisck to the handbag, does annoy me. look at louis vuitton. 12% since february, give me a break. it is the same bag. is it the currency affect? >> opportunistic? >> opportunistic, taking
advantage of the explosiveness of the handbag business and accessory business. which happens to be the hottest area in retail. >> is that because of -- unemployment is down from 10%. it is still high. if you have some money to spend, instead of going out and buying a new house, are you going to buy -- >>, on -- come on. that is absurd. >a handbag instead of a house. >> the average condominium in .3 million. $1 that is average. >> it is aspirational, isn't it? maybe could not afford, maybe this is to your point. you cannot afford the apartment, but you can't afford the handbag. can afford the handbag.
the handbag is a status symbol that says you could afford the condo. >> i go to restaurants where women are showing the bag. >> they want everyone to -- >> my wife is telling me this one is real, that is a fake. -- the handbag is a big deal. if it is a big deal to your wife -- >> you are going to get her one. >> forget the price. >> howard davidowitz is with us. we will come back with more. we have the former oil tycoon from russia talking about his 10 years in prison. his interview is next and happening right here on "street smart." ♪
>> 10 years ago, mikhail khodorkovsky was russia's richest man. vladimir putin accused him of embezzlement. more vocalow and than ever. he spoke with ryan chilcote. >> describe your most difficult day in prison. i had around a 4000 difficult days. to say which was the most difficult is pretty tough. maybe the most difficult day was when i saw them starting to destroy the company. wasaybe the most difficult when i learned that the company's legal counsel had died. day was the toughest
when i got knifed in the face. >> stabbed with a knife. >> it is difficult to choose. >> what was the most difficult thing about prison? >> the most unpleasant part was the feeling of wasting time. food, clothing, even being in the enclosed space. that stuff you could get used to if you have self-discipline. i spent all of those years in prison under double surveillance. >> a prison within a prison. >> yes, and a third prison within that. the first level is where you are
a prisoner like everybody else. the second level is where there is a camera trained on your workstation, your bed, and your table. the third level is security. just to give an example, when there are at least four other presidents reporting back to the authorities on your every move. -- four other prisoners reporting back to the authorities on your every move. >> because president clinton was personally -- because president putin was personally interested. what would you like for christmas? a present i amt waiting for tomorrow when i see my wife. >> wow. that is intense. 10 years in jail. he claims he was sent to jail simply because he was supporting putin's opponents, that is why
>> today is the 12th and final day of the 12 days of bitcoin. buy figuring out how to bitcoin to buy a beer with their claim to having bitcoin stolen. with the little bitcoin he has left, matt went in search of a christmas cheer. >> you take bitcoin? >> yes. >> why? >> this is the second year we have accepted bitcoin. had part ofobody it. i got into bitcoin in early 2010. i have been an enthusiast ever since. >> this tree is a douglas fir,
less expensive. >> not as nice. this big one is a showpiece. >> this is approximately 12 feet and a few inches. >> wow. >> this is a tree we have decided on, a 12 footer. transport.n to --let me -- money scam that. let me scan that. sending transaction, donezo. btc.ne says received, .08 >> and we got this. all those big trees and we got this little charlie brown. >> i felt like it would fit best on the set. how many bitcoins? >> 0.08 bitcoins. >> how much? >> $50.
the stand was 10, the ornaments i got at target with a bitcoin gift card. it is a full on bitcoin three. -- tree. >> is a douglas fir? >> whatever the good kind is from north carolina. the cool thing -- i was talking there with henry romp. they have been running that tree corner for 26 years now. he points out -- a lot of people think of bitcoin as i used to. just a way to buy drugs and escort services on silk road. things for all the good you can do. we go to the other end of the spectrum here. buying a little christmas cheer. >> instead of drugs. >> instead of drugs, i guess drugs could bring christmas cheer depending on what drugs.
we wanted to point out that you could do a lot of good through charity with bitcoin. it is a huge part of the movement. if you look online in bitcoin forums, especially helping the homeless by donating bitcoin. you have organizations -- >> how? >> there is one called martha's table in washington dc that helps feed the homeless. that has been around for a long time. you have some that are almost a susan li -- almost exclusively bitcoin charities. pensacola,ost in florida was around before bitcoin. a only sold about 50 meals week to homeless people. all of a sudden, they were serving 1000 meals a week. now they have bought a nine acre forest that will do a number of things, such as sustainable farming. they will put mobile homes therefore homeless people to stay in. it is really doing so much good.
>> if viewers, as they are listening to you, want to take some of their bitcoin and give it to charity, how do they do it? i gave to you and trish, we accidentally expose your key. this guy on the internet, he instantly stole the $20 from your bitcoin. you see our conversation on reddit. i say keep it, well earned. a good lesson in bitcoin. he said i am going to give it to sean outpost. >> he never gave it back to adam? >> no. >> i thought he said i am going to give it back. >> not made the correct call. he said keep it, lesson learned. he said i am giving it to charity. >> and that i got a tweet from one of the guys who run sean's
outpost that said thank you so much. the stolen bitcoin just bought -- i just picked up a homeless guy off the street and bought him a burger for dinner. it is actually doing very good things. i think people -- because of the sensational aspect of silk road. who does not love to talk about dy underworld and transferring funds. druglords one $100 bills in currency. bitcoin is about something very different. that is something i have taken from the last 12 days. >> a libertarian, slightly anarchist movement. >> a community. to back not need a fed a marketplace. what i am willing to trade with you is the real value of something. >> there is definitely a lot of that. the bottom line, fiat currencies are based on trust.
you have to trust the central bank that supplies you with your it andy not to defacdbase steal money from you. at the end of the day, all central banks are doing that. >> not from us, from our children. >> from our grandparents. >> that is a conversation for 2014. thank you, i love mystery. water it. >> i am sending this homeless stephanie ruhle, it is her birthday today. this little bush. hungry like a wolf. martin scorsese's film starring leonardo dicaprio hits theaters. will a corner the market? also, a christmas classic worth celebrating. dan aykroyd explains "trading places here on "street smart jerk off
>> time to bring you the business behind media, entertainment, and pop-culture. kind of crowded under the christmas tree. studios have lined up -- five new releases for december 20 five. featuring bankers, warriors, even justin bieber. let's start with this naughty and nice with editor of boxofficeguru.com. five films coming out on christmas. >> it is vital. the audience is out of work and school, more leisure time. the spending potential is higher. for studios trying to break records and get market share, this is the final week for them to go in and really blow over
some records if they can. street" seemsll to get attention. is it deserved? it is the most high profile film opening on christmas day. you have five films. if you add "mandela," six. add in four from last weekend. in a one-week period, 10 films are going. about "wolfquestion of wall street." it makes sense that adam and i will love it. howard, you will love it. sense.s we are associated with that field. you go out to kansas and the rest of america, are people going to want to watch a story about trading? will it resume their? >> we have to look beyond the word wall street.
the leonardo dicaprio fan base is big. people will go just for that. movie years ago, " gangs of new york." there is the oscar buzz. of coals a lot of lumps coming out on christmas day. most of the movies opening are not that good. >> what is a lousy one? >> "47 ronin." >> the keanu reeves movie. >> does that surprise you? >> look at the special effects. i like stuff like that. >> maybe wait until netflix next year. why is that bad? >> it does not have much oom ph. not a lot of substance. certainly some style. this already launched in japan, it is not doing well there.
if it cannot sell in japan, how will it still here? >> what do you think about keanu reeves as an actor? a loose term. for action movies, this is his bread and butter. if he can say "woah." >> i hope he at least does his own stunts. >> i don't think the insurance companies will allow him to do all of them. >> "grudge match," de niro and stallone in a comedy about boxing. >> the grumpy old men demographic on christmas. two boxers coming out for one last fight. it might play a little bit to the fan bases of stallone and niro. -- stallone and de >> stallone in a comedy.
bieber's 1 -- justin "never say never." for the 1.6 out of 10 first one. >> this is the opposite audience of "grudge match." preteen girls. it is a brand. the brand is on the decline a little. still enough for these movies because they are low-budget. >> why is the brand on the decline? >> justin bieber is not as big as he was two years ago. he had another movie that did gangbusters. they were getting extra tickets as collectors items. some of the fan base has grown up. >> he may have to reinvent himself and pull in miley cyrus. >> yes, or a madonna who just keeps redoing it. i would prefer miley cyrus.
good to have you here. >> editor of boxofficeguru.com. classic wallne street movie that will always own the holidays. "trading places" turns 30 years old. we are big fans, in part because my cohost looks an awful lot ewis lewis went dark -- l winthorp. >> no can do. >> oh my gosh. ooks and aykroyd compared l a few months ago. he explained why "trading places " is the best business movie of all time. one minute you are on top, the next, your kids do not go to college. knows that "trading
places," that turns 30 this year, is a classic american comedy. it is also the best movie ever made about american business. >> definitely the only movie made about the commodities trade. i cannot think of comedies that have been that successful about business. >> when you got that script, did you understand what was happening at a financial level? >> i lived near the world trade center and i had seen the comex. >> buy low, sell high. >> what i did not understand what is the in of trading. the call and response system. when i got in there taking the orders and learn about it, eddie and i became infected with their enthusiasm and there are journal and. we really -- and they're a general in -- and their adrenaline. we were shouting. trying to replicate that fury
and frenzy that happens in that setting. is entirelying now replaced by computers. bloomberg terminals. >> exactly. thet is very complex at end. for me and other viewers of the film, could you describe in plain english why your character and eddie murphy's character win ended the dukes lose. in orangeas a short juice futures. eddie and i were able to get information. can.y as much oj as you >> we work to the other side of the trade and screwed up the short. you have to know what you are doing. >> looking good. >> feeling good. man. how great is that?
>> looks like you. and aas at the comex bunch of the guys down in the pit go look, it is lewis winthorp. they said -- it was fun. i look like him. >> you do. do not cut your hair or the look will be gone. from thechristmas space station. astronauts installing a new pump. the earth.bove it is the second spacewalk. the first one was on saturday and lasted a 5.5 hours before they ran into a complication with the spacesuit. look at that view. unreal. >> incredible, they are right overhead. >> god bless them. we wish them well and
>> attention shoppers, your favorite store needs you. it is time for insight and action. look at the holiday sales season, only at 2% versus last year. look since 2010. 4%, 3%, here we are at 2%. part of the problem is the fact that retailers are not making a lot of money. they have too much inventory. the biggest discounts since 2009. old navy, can you believe that? neiman marcus, burgers, and saks. grouptailers -- the best out of all the sectors in the s&p 500, up 42%. shop until you drop. the xrt, sell that one. they are not making money. >> the closes next.
toif you expect anything happen, we are getting you caught up on christmas eve. the only stocks you need to know about. time warner cable gains 1% on news regulators are poised to remain hands off on mergers. lawyers say the regulatory and antitrust barriers would present a acquisition of time warner cable by any of their three largest competitors. good news -- at number nine, d.r. horton getting nearly 1% of the housing market data. newome's, purchases of
homes exceeding projections in november. holding near a five-year high. the housing recovery is gaining momentum as mortgage rates climb. >> number eight is blue mobile, shares falling 3%. analysts lowering its rating on the mobile video game maker. the stock could pause in the near term due to concerns about performance of the company's upcoming game and the timing of future games. >> number seven, carlyle up nearly 2% after agreements to sell a stake in a hospital chain. medical part of one's 16 hospitals and employs 10,000 people in turkey. down about 2%, the company selling its audio recognition software business called grace note to tribune for 170 million dollars. this is part of sony's effort to shed units and focus on fewer profits. aboutflix shares down
0.5% as they watch "turbo fast," the first program for kids. this comes on a strong year for netflix, winning an emmy for house of cards. >> i am so excited for the next season. >> you love that show. >> really, i did not even know you are watching it. >> it is so intense. the people are so diabolical. the characters -- you cannot imagine how manipulative these people are. it is awesome to watch. >> you should check out strike back. >> strike that, i do not know it. >> i recommend it. disney shows. disney up more than 0.5%. bob iger's pay package strength despite strong financial performance. $34.3 million. down from 37 and one million last year. >> american express a fraction, they will pay at least $75 million to settle claims from u.s. financial regulators. government agencies say they
used deceptive marketing practices to sell protect and services to credit card companies. >> jpmorgan flat. increased spending and withdrawal limits it imposed on 2 million customers who use debit cards at target during the retailers' data breach. cash withdrawals of as much as $250 a day are now possible. as well as purchases of $1000 a day. they should have used bitcoin. >> all right, our number one stock of the day on this christmas eve is tesla. climbing more than 5% right now. the model s sedan gets to keep its five-star rating for crashworthiness. next year, the highest this initial awarded by the national highway traffic safety administration. the agency will send a review after fire is in washington state occurred when drivers struck metal to bring. -- debri. new highs for the dow and the
s&p. looking like it is going to close of 63. the s&p up 5. >> wow. i do not know whether to look at the hair or the for. there is a lot going on. >> there is a lot going on. record highs. some housing data, durable goods data. that came in very strong. the santa claus rally also having an effect on things. every sector up. down ever so slightly. to get some context on the moves, we have julie to close out the year. >> i just looked up darlene love , who is apparently a singer and actress. she was a phil spector artist. >> yes. very good. >> she's a rebel.